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European Energy Efficient Building Spending To Total Nearly $800 Billion

Spending on buildings is a vital part of any country’s or region’s attempts to increase its energy efficiency, and maybe none more so than in Europe, where buildings account for 40% of the region’s final energy consumption and take up 23 billion square meters of floor area.

New findings from Navigant Research suggest that cumulative spending on energy-efficient buildings in Europe is expected to total nearly $800 billion through 2014 to 2023.

The report, “Energy Efficient Buildings: Europe,” analyzed the European market for residential and commercial building energy efficient products and services across all 28 member states of the European Union as well as Norway and Switzerland. According to Navigant, “the policy landscape for energy efficiency in Europe is among the most stringent in the world,” thanks primarily to two separate pieces of EU legislation — the Energy Performance of Buildings Directive (EPBD) and the Energy Efficiency Directive (EED).

Specifically, the EPBD deals with new construction and major building renovations while the EED covers all energy consumption across the EU and is responsible for setting the region’s 20/20 target.

“The EED aims to achieve 20 percent improvements in energy efficiency, carbon emissions, and the penetration of renewable energy,” says principal Navigant Research analyst Eric Bloom. “Although we believe it is likely to fall short of its goals, it will play a big role, along with the EPBD, in expanding the energy efficient buildings market across the region.”

The annual market for building energy efficient products and services in Europe is currently estimated at $56 billion in 2014, a figure that is expected to rise to $109 billion in 2023 (as seen in the chart above). Cumulatively, the forecast figures total $791.7 billion across the whole period.

Navigant expects energy management technologies, water heating and efficiency, and services and commissioning segments to show the highest rates of growth over the period. As a whole, the European energy efficient buildings market is led by France, Germany, and the United Kingdom — the three largest countries in terms of building stock, and countries that consistently show strong policy support as well as companies with product and service innovation.

However, as a whole, Europe’s enforcement and coherence is a concern for the Navigant researchers. They also note that several factors are currently hindering the market:

Lack of technical resources and capacity within companies to elevate energy efficiency decision-making to the highest levels

Competing options for corporate investment

Split incentives between tenants and landlords

Lack of incentives and long payback periods

Lack of public sector capacity to manage large portfolios and prioritize investments

The authors conclude:

Thus, in spite of the relatively high and rising energy costs in Europe and a vast array of technology and service options available, the energy efficient buildings market is under-delivering the cost-effective and technically feasible improvement opportunities available to consumers.

With such a complex cross-section of countries making up the European Union, it is utterly unsurprising that there is difficulty ensuring regional stability for the building industry. Nevertheless, as with many issues facing the EU at the moment, those countries leading the way will need to make serious investments in time and money towards those countries falling behind if the region is to make their 20/20 targets.

About the Author

Joshua S Hill I'm a Christian, a nerd, a geek, and I believe that we're pretty quickly directing planet-Earth into hell in a handbasket!
I also write for Fantasy Book Review (.co.uk), and can be found writing articles for a variety of other sites. Check me out at about.me for more.

Actually this where the giant negawatts mines are…in buildings. When we dwell on tacking pv onto inefficient buildings and thoughtless lifestyles it is lipstick on a pig. When we retrofit and reduce energy demand by 50-80% we are really making a dent in the problem.

Jan Veselý

I have talked the heating issue with my father. So I know that in late 60th was coal for heating so cheap that nobody cared about some insulation in his parent’s house. When the same house was refurbished in 90th to natural gas heating it was not “dirt cheap” to heat (just cheap) but it was much more comfortable. Yep, but natural gas costs now 4x as much. So, every new construction and every reconstruction now include insulation, insulation, insulation.
Everybody does that in my hometown – factories, schools, services, homes. It saves helluva lot of money.

Wind Energy

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